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Dss with ccj but guarantor?

Hi,

This is my first buy to let property, prospective tenant is a single mum(25) of two children 1 and 3. We told her that it would be subject to tenancy referencing that would be carried out by upad. As she is on housing benefits she would also require a guarantor which her father agreed to act as.

We have just received the result of the credit checks and hers is showing an unresolved ccj from August 2010 and a credit score of 100 and she has also failed the affordability check. Her dad who is to act as guarontor has passed the credit check. She never mentioned the ccj when I told her that he let was subject to one. We are also awaiting references from her current landlord.

Initially the idea was to rent to a working person only. The property is only a small two bedroom house with rent being £525 per month so after speaking to an agent they said a hb person can sometimes be good as they don't tend to move so often. I asked if she would agree to get the housing benefit paid direct to us which she said she would prefer. I think she is entitled to £475 per month hub so would need to find £50 per month.

What are people's thoughts of taking her on with her ccj and poor credit report even though her dads appears ok. Also if the council pay the £475 and she defaults on the make up pay how will difficult would it be to get possession of the property?

Part of me thinks that if we can get paid directly from the council that is good but am a bit nervous about her bad history. Also how easy/successful is it to get the guarantor to pay if she defaults.

A non-reported CCJ is a clear warning that this person is highly likely to cause you grief. The guarantor is great - but making them pay can be hassle. Essentially, if the guarantor is not willing to pay (and how many do you expect are?) you will have to sue.

With regard to eviction, you could evict with ease at the end of the fixed term but if she can't find somewhere else then expect her to stay until the bailiffs remove her - more cost and hassle.

This is only an opinion, but my gut reaction is to not touch her with a barge pole!

I'm having terrible difficulties with a hb tenant. Things weren't too bad when HB was paying me direct, but as soon as he had to get a job, bingo he didn't want to pay.

She will probably have great difficulty in finding the extra £50 each month. If you want her out, you'd probably have to wait till she has two months of unpaid rent. She will find it really hard to find somewhere else and the council will tell her to stay put until you evict her.

Also, when her children are of a certain age, she will be encouraged back to work - she will be expected to pay the rent direct to you herself out of her wages.

Perhaps others will give you different advise, but mine is just my own opinion based on my own experiences. Hope it helps.

Surely if the applicant was referenced she would have completed an application form where the CCJ question would normally have required an answer. If it was unanswered or she lied then you should give her a wide berth. If you are struggling to get a tenant and only have interest from HB applicants (such as myself with a 1 bed flat to let) then I would prefer to leave it unoccupied until I obtain one to my liking.

The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.